Poundland has suspended its involvement in the back-to-work scheme while the government clarifies its position. Photograph: Martin Argles for the Guardian

The discount retailer Poundland has become the latest high street chain to take a step back from the government's back-to-work scheme as concerns rise over the use of unpaid benefits claimants in some of Britain's biggest companies.

In a statement, the retailer said it had decided to withdraw from a "mandatory work programme" while the government clarified its position on the scheme, but said it would continue to offer voluntary work experience as part of a separate initiative.

"We have taken recent findings about the mandatory work programme candidates very seriously and with further investigation have decided to withdraw from the initiative," said the company's chief executive, Jim McCarthy.

Poundland would continue to talk to the Department for Work and Pensions (DWP) to ensure no jobseeker was penalised for dropping out of a placement, as opposed to the current system under which participants can lose some benefits if they drop out without "good reason" after the first week.

It was not immediately clear to which of the several government work experience schemes Poundland was referring in its statement. The Guardian has asked for clarification of the retailer's position and is awaiting a response.

On Tuesday, the supermarket giant Tesco said that although it would continue to participate in the coalition's work experience scheme, it would now offer jobseekers a choice of remaining on benefits or taking up paid work with a guarantee of a staff job at the end of the four-week placement if the trial was successful.

Poundland has come in for particular attention since lawyers for a woman who completed three weeks of unpaid work experience in its Birmingham store claimed the placement had been contrary to human rights legislation on forced labour and thus breached her human rights. Cait Reilly, 22, brought her case against the DWP, which strongly disputes her claims but admits it made a mistake by not telling Reilly she had the right to opt out of the placement.

Speaking on BBC Radio 4's Today programme, the employment minister, Chris Grayling, defended the government's work experience programme, saying it covered the care and technology sectors as well as retail, and that even a placement in a supermarket meant "much more" than just stacking shelves.

He attempted to play down growing criticism of the scheme in recent weeks, which has led to more than a dozen organisations announcing either their suspension of or departure from the scheme. "What's happened in the last week is we've got a lot of companies who are very jumpy," he said, claiming that an internet campaign against the scheme was being run by "a front for the Socialist Workers party".

"It's a false campaign," he said. "I don't accept that the scale of the campaign is very large. It's a small number of activists who are deliberately targeting these companies and trying to destabilise them."

Shortly after his appearance on Today, Grayling retracted a claim that his email account had been hacked by the activists concerned, saying instead that his email address had appeared on a complaint lodged with Tesco.

In a statement, the national secretary of the Socialist Workers party, Charlie Kimber, noted that the minister had "retreated ignominously" from his claim. "Grayling should also know that the campaign against forcing the unemployed to work for nothing is supported by very large numbers of people, not just the SWP. That is why the campaign by Right to Work alongside others has scored successes against several major employers and will continue until the whole scheme is scrapped."